Aetna trial day 9: what you need to know

December 16, 2016

  •  The witnesses for today were Dr. J. Mario Molina (President and CEO of Molina) and Lisa Rubino (Senior Vice President for Medicare for Molina). The defense presented Molina as a major, rapidly growing company that was up to the divestiture challenge while DOJ worked to portray Molina as ill equipped to compete in health insurance markets. 

  • Dr. Molina claimed that Molina had grown over the past 35 years, and that it specialized in government programs (Medicaid) and would do well. DOJ countered that the only time Molina acquired an MA plan was in one acquisition, that it left the market a year later, and that  Molina emails said, "This is a very different business from what do...Unless we acquire some talent, we are woefully under resourced to take this on."

  • Molina argued that in his email he was trying to be diplomatic to some board members who were poorly informed, and he didn't really agree with the statements. DOJ produced additional emails from his brother where he stated, "we lack management with the requisite Medicare concerns"; additionally, Mr. Molina told investors that rapid growth was putting great stress on Molina's business. 

  • Molina responded that the problems he was describing to investors later turned out to be exaggerated. His company's experience is mostly with Medicaid, but it will market to all Medicare beneficiaries,and a lot of Medicare enrollees are below 250% of the poverty line (the kind of customers Molina is used to). 

  • The next witness, Lisa Rubino, asserted that Molina has top hospitals and providers, and will be able to match them up with the 290,000 lives it will get in the divestitures. She also testified that Molina has MA plans in the San Antonio counties in DOJ's complaint, and they will be able to effectively preserve competition. 

  • DOJ then began to effectively rebut her claims. They produced internal memos stating that Molina's options, benefits, and networks were below average compared to competitors.Molina also has lower star ratings, which make designing good benefits more challenging. 

  • The last and sharpest blow was an email chain between Lisa and her superior that DOJ produced. In the email, she said that Molina would likely not enter any new counties after getting Aetna and Humana's contracts, and they might reduce the county footprints in cases of low membership or potential. This indicates that despite their claims, people might see their benefits and networks change due to divestitures. 

     

     

     

     

     

     

     

     

     

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